Questions from Personal Finance

Q: Thomas can invest $10,000 by purchasing a 1-

Thomas can invest $10,000 by purchasing a 1-year T-bill for $9,275, or he can place the $10,000 in a 12-month CD paying 8%. Which investment will provide a higher return? In addition to return, what e...

Q: Troy paid $9,600 for a T-bill with

Troy paid $9,600 for a T-bill with a face value of $10,000. What is Troy’s return if he holds the T-bill to maturity?

Q: Bart is a college student who has never invested his funds.

Bart is a college student who has never invested his funds. He has saved $1,000 and has decided to invest it in a money market fund with an expected return of 2.0%. Bart will need the money in one yea...

Q: What is a NOW account? How is it different from a

What is a NOW account? How is it different from a regular checking account? How does a savings account compare with a NOW account?

Q: What terms does a financial institution specify for certificates of deposit?

What terms does a financial institution specify for certificates of deposit? Why are rates on CDs higher than those on savings accounts? What factor would most affect your choice of maturity date on a...

Q: How does a money market deposit account (MMDA) differ from

How does a money market deposit account (MMDA) differ from a NOW account? When might a depositor use an MMDA?

Q: On June 1, Mia deposited $4,000 in an

On June 1, Mia deposited $4,000 in an MMDA that pays 5% interest. On October 31, Mia invested $2,000 in a three-month CD that pays 6%. At the end of the year, how much interest will Mia have earned, a...

Q: What is liquidity? How is your personal cash flow statement used

What is liquidity? How is your personal cash flow statement used to help manage your liquidity? How does money management relate to the cash flow statement?

Q: Jill placed $10,000 in a 90-day CD

Jill placed $10,000 in a 90-day CD that offered an annualized return of 4%. How much interest will she earn on this CD?

Q: Jason is in his mid-50s and was raised by parents

Jason is in his mid-50s and was raised by parents of the Depression era. As a result, he is very risk adverse. He recently came into a very large amount of money, and he wants to put it where it will...